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5 Tips To Help Improve The Relationship With Your Contractor


Every member of your real estate investing team is important. All it takes is just one person to drop the ball to send you in scramble mode. This can result in increased expenses, delayed turnover and rocky relationships with everyone on site.

If your investing focus is rehabs and flips perhaps the most important team member is your contractor. They hold the key to the work being done, how likely you are to stay under budget and just how quickly the property is finished. A good relationship allows you to focus on other projects and grow your business on your time. A poor relationship will have you driving to the property every day and constantly keeping everybody in line. Here are five important tips to help improve the relationship with your contractor.

  • Always ask for itemized list of work. One of the most common areas of contention is typically with the budget. Most investors have no problem paying for quality, but they always want to know what they are getting for their money. This must be clearly communicated prior to any work being done or commitment given. You have every right asking your contractor for an itemized list of their work. Find out what supplies they are paying for and what the cost per task is. If they balk at providing this, it may be a red flag that they either aren’t professional enough to produce one or they have something to hide. If you haven’t worked with your contractor before it is a good idea to get three separate itemized quotes, so you can compare apples to apples. Like everyone else, contractors have a right to earn for the work they do. You just need to know what you are paying for so there is no miscommunication down the road.
  • Discuss expectations. There should be no misunderstanding the expectations of what you want done. You need to make it perfectly clear the work you expect and the goal of the project. This can make for an awkward conversation or two, but it is better to get them out of the way prior to starting than four weeks into the project. With expectations, you should also expect your contractor to have expectations on your end. They may have questions for you regarding scheduling, budget, timeframe and payment. You should answer everything and put everything you are thinking on the table. The goal isn’t to simply plow through contractors and beat them down for every nickel. Your goal should be to produce a long-term relationship that is mutually beneficial for both parties. You should be honest and open with your contractor and not make every project a rush or a favor. You can only play the discount card so many times before your contractor catches on and has enough. The more open both parties are the better the long-term relationship will be.
  • Time frame/work flow. One of the most important aspects of any house flip is scheduling. You are on the clock the minute you take ownership of the property. Your contractor may give you a discount, but it won’t do you much good if they can’t start for 30 days. You and your contractor need to spend time diving into the schedule and figuring out a plan of attack. Everyone that works on your property either works for themselves or receives a paycheck from someone that does. If there is a mix-up or scheduling conflict they will essentially waste a day that could have been used to make money. Juggling the drywall, painter, electrician and plumber can be difficult, but it is an essential part of their job. There needs to be a steady flow of work done at all times on every rehab. A good contractor knows how to keep everyone working without getting in each other’s way.
  • Communication. As you discuss your project and talk about numbers and scheduling it is important not to forget communication. Simply put, how will you and your contractor keep tabs on what work is finished, what needs to be done and any problems along the way. Will they call you at the end of the day, send a work completion email or make a video of each completed task? You don’t want to have to check up on the project daily, but you do need to be kept in the loop. Most people use text to communicate, but this may not be best when working on a rehab project. Many things can get lost in translation or delayed because of interpretation. You don’t want to be constantly looking over your contractors back but there must be a way of keeping you updated that is discussed.
  • Payment. The elephant in the room in most contractor conversations is money. They want to know how much money they can expect upfront, when the next installment will be made and in what manner they can expect payment. You should always beat them to the punch and make this part of your initial conversation. Whatever manner you are comfortable paying you need to disclose prior to starting. Your contractor has the right to expect prompt payment as soon as the work is finished.

It may take some time to develop but you and your contractor should feel like a team. You are both reliant on each other to maximize the bottom line and generate income. The better you are at communicating your expectations the better the relationship will be.

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